In case of any further query or request for information, please contact:
Zuhour Ahmad M Zuher Al Samsam
Director of Legal
investor@pepsidrc.ae
Tel: 04-8025000
Fax: 04-8025090
Dear Shareholders,
I am pleased to present the annual report of Dubai Refreshment PJSC (DRC) for the financial year ending 31 December 2024.
This year posed significant challenges, including regional political instability, supply chain disruptions, and intensified competition from both established players and emerging B brands. Despite these obstacles, DRC demonstrated resilience and strategic agility, successfully mitigating risks through a proactive market approach. By introducing strategic value packs, launching innovative new products, and implementing cost-saving initiatives, we protected our key accounts, minimized losses, and not only retained but also expanded our partnerships. These efforts resulted in a 3% growth in volumes, a 2% increase in revenues, and a net profit before tax of AED 149.5 million.
In 2024, we remained committed to driving operational efficiency and long-term growth. Our key initiatives included stringent working capital management, process automation, cost structure optimization, and digital transformation initiatives such as SAP S4 Hana Cloud implementation currently in progress. These advancements have enhanced our agility, strengthened our competitive position, and laid the foundation for future success.
Revenues
DRC achieved total net revenues of AED 818.0 million in 2024, marking a 2% increase from AED 803.1 million in 2023. This growth was driven by strong performance across all business segments, reflecting the successful execution of our strategic initiatives. As previously highlighted, this positive momentum stems from key initiatives, including the launch of innovative new products such as Sting and Mountain Dew Zero. These additions have played a vital role in strengthening customer retention and expanding our reach across all channels, attracting new consumers and reinforcing our market presence.
Profitability
On a comparable basis, DRC’s net profit before tax for 2024 reached AED 149.5 million, up from AED 141.6 million in 2023 (excluding a one-time gain of AED 220.2 million from the sale of land in Al Quoz). This growth was primarily driven by increased beverage volumes, revenue contributions from new product launches, the successful expansion into Snacks operations, and higher interest income on company cash.
Starting in 2024, the Company became subject to Corporate Tax, as mandated by the UAE rules and regulations. Accordingly, a tax charge of AED 13.7 million was taken in books resulting in a profit after tax of AED 135.8 million for the year.
*On a comparable basis, one-time gain of AED 220.2 million has been excluded from 2023 net profit.
Cash Flow
DRC maintained a strong cash position in 2024, remaining entirely debt-free with no outstanding loans. The Company generated AED 202.2 million in cash from operations, a significant increase from AED 153.3 million in 2023. This improvement was driven by robust cash management strategies, with a particular focus on optimizing working capital investment to maximize cash flows.
Demonstrating our commitment to delivering value to shareholders, DRC distributed a total dividend of AED 288 million in 2024, which included a special dividend of AED 216 million.
Future Growth
As part of our commitment to continuous improvement, DRC’s Board and management remain focused on driving sustainable, profitable growth by enhancing productivity and operational efficiency. We are actively exploring new business opportunities and implementing strategic initiatives to expand our market share while solidifying our leadership position in the UAE.
The Company’s consistent performance over the past few years underscores a strong and steady growth trajectory. We are well-positioned to capitalize on emerging opportunities and will continue investing in advanced information systems to optimize processes, enhance decision-making, and maintain our competitive edge. Additionally, as part of our Emiratization initiative, DRC remains fully committed to hiring and developing Emirati talent and exceeding the requirements set by Ministry of Human Resources and Emiratization.
On behalf of the Board of Directors, I extend our deepest gratitude to the visionary leadership of the UAE:
His Highness Sheikh Mohamed Bin Zayed Al Nahyan, President of the UAE; His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister of the UAE, and Ruler of Dubai and their brothers the rulers of Emirates, the members of the Federal Supreme Council. Their unwavering leadership continues to foster an environment of innovation, economic prosperity, and sustainable growth, enabling businesses and individuals to thrive.
I would like to extend my deepest gratitude to our employees, shareholders, customers, suppliers, and business partners. Your unwavering dedication, trust, and collaboration have been the foundation of our success, and we deeply value your contributions.
As we move forward, innovation, operational excellence, and sustainable value creation will remain at the heart of our strategy. We are excited to build upon our achievements and drive continued growth in the years ahead.
Finally, I would like to express my sincere appreciation to Mr. Tarek El Sakka, our former CEO, for his remarkable leadership and invaluable contributions over the past 17 years. His vision and dedication have been instrumental in shaping DRC’s success. We wish him the very best in his future endeavours.
At the same time, I am pleased to welcome our new CEO, Mr. Mahmoud El Meligy. The Board of Directors and I are confident in his leadership and strategic vision, and we look forward to continuing DRC’s growth and success under his guidance.
Thank you,
On behalf of the Board of Directors,
Mr. Ahmad Bin Eisa Alserkal
Chairman of the Board of Directors